Service Business

How to become a taxi driver - basic information

Setting up your own taxi business can turn out to be a very good business idea. Read our article on how to become a taxi driver!

How to become a taxi driver - general characteristics of the TAXI company

Transporting people by taxi is a gainful activity that involves the paid transport of customers by passenger car to a designated place. The toll is usually determined on the basis of the rate per kilometer. The taxi must be intended for the transport of passengers (but not more than 9 passengers with a driver) and their hand luggage.

Preliminary requirements related to running a TAXI company

What requirements must the future taxi driver meet? A person who wants to run a taxi company must:

be at least 21 years old, have a category B driving license,
have a certificate of no health and psychological contraindications for work, completed road transport training or have a letter confirming that he has been working as a driver for five years,
have legal title to dispose of the vehicle,
may not be convicted by a final court judgment for intentional crimes against life and health, sexual freedom and decency, security in communication, property, credibility of documents or the environment.

The main requirements for entrepreneurs applying for a license are, as you can see, the requirement of a good reputation. If the candidate for a taxi driver meets the above requirements, he must additionally obtain the appropriate license. Counselor for a commune with more than 100,000 residents, may require the entrepreneur a certificate of completion of training in road transport by taxi, which was confirmed by a passed exam, confirming the knowledge of the topography of the city and local law, by the entrepreneur personally performing the transport (as well as the drivers employed by him).

Acceptable forms of running a TAXI company

The future taxi driver can choose any type of business activity apart from the partner company. In Poland, you can choose to run a company as a sole proprietorship, civil partnership or commercial company. Commercial companies are partnerships - general partnership, limited partnership, limited partnership, limited joint-stock partnership and capital companies - limited liability company. and a joint stock company.

Most often, the owners of companies that provide passenger transport by taxi decide to set up a sole proprietorship. It should be remembered that any form of business requires the future taxi driver to meet certain conditions.

How to set up a TAXI company?

Taxi driver and sole proprietorship

It is a type of business that, as the name suggests, is self-conducted. One-man operation means that the company has only one owner. This is not a restriction when it comes to hiring employees. Initial capital is not required from the entrepreneur, and the future taxi driver does not have to keep full accounting. For small enterprises, it is possible to keep simplified accounting until the turnover does not exceed EUR 1,200,000 (according to the exchange rate from September 30 of the previous year).

It is worth starting a sole proprietorship because of the possibility of taking advantage of discounts and subsidies. A novice taxi driver can, for example, pay ZUS contributions at a lower, preferential rate for the first 24 months of running a business or use EU de minimis aid.

Taxi driver and civil law partnership

The civil law partnership does not have personality or legal capacity and operates based on the provisions of the Civil Code. It is a good choice for small businesses, including family ones.

This type of company may be established by at least 2 natural or legal persons. A civil law partnership is not subject to registration in the National Court Register, but partners must remember to enter it in the Central Register and Information on Economic Activity (CEIDG). Each partner is responsible for the partnership with his / her personal property. No capital is required to register a civil law partnership.

Taxi driver and trading company

Commercial companies are:

general partnerships,
partner companies (this type of business may not be conducted by a person who wants to set up an enterprise consisting in the transport of passengers by taxi),
limited partnerships,
limited joint-stock partnerships,
limited liability companies,
joint-stock companies.

All these types of companies must be entered in the National Court Register kept by the district courts competent for the registered office of the company being created. The required forms are available on the website of the Ministry of Justice and directly at the courts.

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PKD designation for a taxi company

The PKD number for the activity providing passenger transport by taxi is: 49.32.Z - activity consisting in transporting individual passengers to places agreed by them.

The best form of taxation for your own TAXI company

For a taxi driver, the easiest form of settlement is a tax card, but then the driver can only perform one activity. The tax card also does not allow you to use any deductions. If the future driver runs another type of business activity apart from transporting passengers by taxi, it will be a good idea to choose taxation in the form of a lump sum - i.e. 8.5% of income tax. However, it should be remembered that with a lump sum, the taxi driver also cannot deduct costs related to, for example, repairing the car. However, settling the taxi business will not be profitable if the driver chooses a flat tax. Therefore, it is worth considering other forms of business taxation.

Taxation on general terms

With an income lower than PLN 85,528, the taxi driver will be obliged to pay tax in the amount of 18% of the income, if the income is higher - the tax will amount to 32%. What are the advantages of general taxation? The taxi driver will be able to take advantage of tax breaks and joint settlement with his spouse in the annual settlement. However, during the year, when calculating the advance tax, income may be reduced by the paid social security contribution and the loss incurred in previous years. The tax, on the other hand, is reduced by the health insurance contribution and the amount that reduces the tax. The tax-free amount occurs only in the form of taxation under general rules, so it can be treated as an advantage of this method of settlement.

General rules are the basic form of taxation in Poland. If the taxpayer does not decide to choose another method, it falls to him not ex officio.

Lump sum on recorded revenues

The lump sum is a simplified form of settlement and it is possible when the annual income does not exceed PLN 250,000. euro. The amount of tax depends on the amount of income, therefore taxi drivers will not be able to deduct tax deductible costs in this case. After the end of the tax year, until the end of January of the following year, the lump-sum taxi driver settles the revenues that he earned in the previous year under this method of taxation.

The flat rate for taxi services is 8.5 percent.

Tax card

The amount of the tax rate when paying with a tax card depends on the number of residents in which the activity is performed and, as in the case of a lump sum - it is not possible to deduct tax deductible costs. When choosing such a method of taxation of activities, a specific amount should be transferred to the tax office by the last day of each month. In the event of delays, the taxi driver will be required to pay an additional tax card - PLN 215. This type of taxation does not require documentation. When using a tax card, business must be conducted only in Poland, and the tax amount for the tax card is set for the whole year in advance.

No.

Type of service

In a town with a population of inhabitants (rates in PLN)

up to 25,000

over 25,000 to 100,000

over 100,000 to 500,000

over 500,000

Taxi services for the transportation of passengers

206

216

236

253

When running a business settled on the basis of the Tax Income and Expense Card or the Income Register, entrepreneurs can use online accounting intended for independent bookkeeping. An example of a platform for independent accounting can be wFirma.pl. It is a much cheaper option than a traditional accounting office.

Running a TAXI company with or without VAT

Taxi driver as an active VAT payer

Taxi drivers who intend to perform activities for other VAT payers or plan to achieve high turnover from business activities should decide to register themselves as an active VAT payer. In this case, being a VAT taxpayer is associated with the benefits of the possibility of deducting VAT on the invoices received.

The provision of services related to the transport of passengers by taxi is taxed at the rate of 8% VAT.

The taxi driver has the option to change the amount of VAT taxation - he may choose to be taxed at a flat rate of 4%. This is in line with Art. 114 of the Act on tax on goods and services.

Art. 114 sec. 1. A taxpayer providing passenger taxi services, with the exception of passenger car rental with a driver (PKWiU 49.32.11.0), may choose to tax these services in the form of a lump sum at a rate of 3%, after prior written notification to the head of the tax office by the end of the month preceding the period in which will apply a flat rate.

Pursuant to Art. 146a point 4 of the VAT Act from January 1, 2011 to December 31, 2018, subject to Art. 146f, the tax rate is 4%.

The choice of the flat rate requires the submission of the VAT-R and an indication of the flat-rate form in box 47.

In the event that the taxi driver previously conducted activities taxed at the 8% rate, in order to select the flat rate, he must submit a VAT-R update.

Taxi driver exempt from VAT

The choice of VAT exemption is beneficial in a situation where the recipients of goods or services will be entities also exempt from VAT (e.g. private persons).

Taxpayers whose value of taxable sales did not exceed the total amount of PLN 200,000 in the previous tax year are exempt from VAT. The amount of tax is not included in the sales value.

Cash register for the taxi driver

According to the change in the regulations on exemptions from the cash register, taxi drivers are required to install a cash register. The driver is obliged to print a fiscal receipt for each sale and issue the printed document to the passenger. It also has to verify the correctness of its operation on an ongoing basis, with particular emphasis on the correct programming of the names of services, the value of tax rates, the currency with its symbol and value of the conversion factor, indication of the date and time, and the correct assignment of the names of goods to tax rates. In the event of a failure, it is necessary to report this fact to the operator of the cash register service.

In the case of taxis using taximeters connected to a cash register, this should be the period for legalizing the taximeter. When using a cash register, it is obligatory during the period of its use to keep and store a cash register book. It records all repairs and inspections, as well as reports related to the fiscalisation of the cash register and its closure.

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Social security contributions and running your own TAXI company

Application of the taxi driver for insurance

A taxi driver who starts running a business reports it on the CEIDG-1 form. Then the application with a copy of the CEIDG entry is sent to ZUS. The latter prepares a declaration of the contribution payer on the ZUS ZFA form.

Nevertheless, the entrepreneur has to register for social security and health insurance on his own. The entrepreneur has 7 days from the date of commencement of business activity to apply for insurance. To do this, fill in the form:

ZUS ZUA - if the taxi driver is subject to social and health insurance,

ZUS ZZA - if the entrepreneur is subject only to health insurance (social insurance is covered by full-time work or other activities).

Sickness insurance is voluntary for the entrepreneur. ZUS covers him with this benefit upon his application. It is submitted on the ZUS ZUA form, along with registration for compulsory social security and health insurance.

Taxi driver and preferential ZUS contributions

A taxi driver starting a business may take advantage of preferential ZUS contributions, which cover a period of 24 full months. The amount of ZUS contributions depends on the average salary in Poland. On the other hand, the basis for the amount of contributions for people who pay social contributions on a preferential basis is 30% of the minimum wage in a given year.

Company account for the TAXI company

The taxi driver is not required to set up a separate company account. May use a private account for business purposes. However, it must remember that the account must have one owner (couples with a joint account cannot use it for corporate purposes).

Making or receiving payments related to the performed business activity should be carried out via the entrepreneur's bank account whenever:

another entrepreneur is a party to the transaction from which the payment results
the one-off transaction value, regardless of the number of payments resulting therefrom, exceeds the equivalent of PLN 15,000.

Public music playback and TAXI's own company

If a taxi driver plans to play music in public, he must obtain a license. It is granted for various forms of using works protected by copyright, e.g. for public reproductions and performances of works. In case a driver is unsure whether or not he needs a license, it is a good idea to contact a collecting society.

Marketing of the TAXI company

In order to plan an effective marketing strategy, you should first answer some basic questions:

Who am I addressing my offer to?
What goals do I want to achieve?
What distinguishes me from other companies?
What is my company the best at?

Then, after analyzing the responses, move on to developing your company's advertising plan. At the beginning, you can order a printing house to prepare business cards. Quite often, customers of various service outlets accidentally take business cards that are on the counter. Depending on the goals the entrepreneur wants to achieve, you may consider printing out flyers or running your own website.

In conclusion, to become a taxi driver you must first get a license and pass the city topography exam, then register your business. However, you need to remember about the high competition in the industry, so it is worth doing your own market research and determining whether this type of activity will simply pay off.